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    A common approach of estimating the variability of returns involving forecasting the pessimistic, most likely, and optimistic returns associated with the asset is called?

    A. sensitivity analysis

    B. financial statement analysis

    C. marginal analysis

    D. break-even analysis

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    Solution Preview

    Here are definitions of each of the answer choices:

    Sensitivity analysis = a technique used to determine how different values of an independent variable will impact a particular dependent variable under a given set of assumption.

    Financial statement analysis = an assessment of the viability, stability and profitability of a business, ...

    Solution Summary

    The solution defines each of the four answer choices, then gives the correct answer to the multiple choice question.